Taiwanese Business in Mainland China: From Domination to Marginalization?

Abstract

One of the mysteries of our age is how the People’s Republic of China (PRC) — an isolated, impoverished nation that eschewed private business and international trade for decades — became the world’s factory and second-largest economy in little more than twenty years, China’s success owes much to the globalization trend that took off in the 1970s and to the political and economic reforms its leaders put in place in the 1980s. Most accounts of China’s explosive economic growth focus on Deng Xiaoping’s decision to unleash his nation from the restraints of Maoist economic policy, and it is certainly true that the pent-up potential of an economy that had been artificially restrained goes a long way toward explaining China’s success. Nonetheless, few developing countries manage to achieve the rates of growth that have characterized the PRC economy since the 1980s, and only a handful of countries can boast of the kind of deep development — including industrialization, urbanization and industrial upgrading — China has achieved.